Warrant for city of Lubbock records opened

Friday

May 27, 2011 at 10:28 PM

A U.S. District Court magistrate has opened, at the request of the U.S. Attorney's Office, a search warrant sought for and executed by FBI agents three years ago during an investigation of the city of Lubbock's relationship with one of its health insurance providers.

The documents show what the FBI knew about working relationships between some former city officials and American Associated Agency Group, which maintained the health insurance business for Lubbock's 6,000 employees from 2004 until 2006. AAG was under the auspices of The Parker Group.

The city dropped AAG amid concerns of improper fees and commissions. Lubbock officials remain locked in a battle over what they said were overcharges by Parker's company, as well as legal fees.

Recently, the city received the results of an audit conducted by an independent firm, as part of an ongoing lawsuit with AAG.

Last month, the city reviewed some of those results in a closed-door session. However, the city would not release the details of that audit when requested by the A-J under the Texas Public Information Act. Instead city officials appealed to the Texas Attorney General's Office, which has until June 20 to respond.

According to an affidavit filed by FBI agent Michael N. Orndorff on May 14, 2008, those named as under investigation were: former Lubbock City Councilman John W. Leonard, Ted Parker, chairman of The Parker Group; Jim White, CEO and president of Jim White Insurance Agency Inc. and Gary Boren, a former city council member and vice president of G. Boren Services.

No charges have been filed against those individuals.

The affidavit in support of the search warrant was made public for the first time Friday afternoon in court records. It had been sealed by request of the U.S. Attorney's Office in May 2008.

FBI spokesperson Mark White referred reporters from The Avalanche-Journal to the U.S. Attorney's Office when asked why the search warrant was made public on Friday.

White said he could not talk about the investigation.

"The affidavit has to stand on itself," the spokesman said.

The U.S. Attorney's Office did not return a telephone call.

When the A-J contacted Parker about the investigation he said, "No comment," before he hung up. He did not answer a follow-up telephone call or messages left on an answering machine.

Jim White also said he had no comment when reached by telephone Friday.

Leonard and Boren did not return repeated telephone calls or answer messages left on answering machines.

City attorney Sam Medina said he had not looked at the court documents and declined to discuss them.

In his affidavit, Orndorff cited allegations of conspiracy, false statements, health care fraud and wire fraud against the four men named in the court document.

In the 45-page document, the FBI agent outlined a timeline to support his allegations, but told the magistrate the agency needed computers, telephone records, other electronic communications and various records to continue with the investigation.

The court granted the petition.

As a result, on May 14, 2008, at 10:15 a.m., the FBI seized equipment and records from the Lubbock Municipal Building and the Lubbock Information Technology Department Building, according to court documents.

A court document signed and dated April 27, 2011, indicates the documents and other information from electronic devices are in FBI custody.

Mayor Tom Martin, who was not in public office at the time of the FBI raid on City Hall, said Friday he remembers the FBI interviewing him three years ago.

"That's the only contact I've had with them," Martin said. "I haven't heard anything in three years."

Former Mayor David Miller said he is aware of the federal court documents' release, but declined to talk about the case.

"I think we'll just let it play out in the law enforcement and the legal system," he said. "I do think that the public deserves to know everything there is to know about this case."

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